Pakistan's services sector has posted strong export growth in the first half of the fiscal year, yet a simultaneous surge in imports has widened the trade deficit, highlighting persistent external imbalances.

According to data released by the Pakistan Bureau of Statistics, services exports rose by 16.51 percent to $4.764 billion during July-December FY2025-26, up from $4.089 billion in the same period last year.

However, this improvement was offset by a parallel increase in imports, which climbed by 15.75 percent to $6.504 billion from $5.619 billion. As a result, the services trade deficit expanded to $1.739 billion, compared with $1.529 billion a year earlier, marking a rise of 13.73 percent.

Monthly data reflects a similar trend. In December 2025, exports of services increased by 15.94 percent year-on-year to $935 million, while imports rose more sharply by 23.90 percent to $1.308 billion.

On a month-on-month basis, outward shipments of services grew by 15.84 percent in December compared with November. Meanwhile, imports recorded a steeper increase of 34.39 percent over the same period.

The figures suggest that while Pakistan is gaining momentum in services exports, the faster pace of import growth is eroding the net benefit. This divergence underscores the structural challenge facing the external sector, where rising demand for imported services continues to outstrip export gains.

The data points to a familiar pattern: progress in export performance alone is insufficient to stabilise the external account when import pressures remain elevated.